Wafer, petrochem industries to be hit hardest by water hike, Latest Singapore News - The New Paper

Wafer, petrochem industries to be hit hardest by water hike

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Water price increase will hit industries that use significant amounts of non-potable water most

Not all industries will be hit hard by the water price increase.

Industries that use significant amounts of non-potable water, including wafer manufacturing and petrochemical industries, will be most affected, capital projects and infrastructure partner of PwC Singapore Lee Seng Chee told The New Paper.

"This is in contrast to other industries that may come to mind, such as laundry and food and beverage," he said.

Water prices will increase for the first time in 17 years, Finance Minister Heng Swee Keat said on Monday.

Including taxes, the prices will go up by 30 per cent.

At zi char stall Hong Sheng Restaurant in Toa Payoh, owner Madam Lam said it spends $750 a month on its water bill.

"If they increase the price of electricity, we can still try to work with it by not turning on our lights so often.

"But water is a necessity, and we have to use it daily to cook our food and keep our utensils clean," she said.

Not all businesses are expected to pass on the higher costs of water to consumers, reported The Straits Times.

"Water makes up between 5 and 10 per cent of business costs for coffee shop stalls, so I don't think the hike will affect coffee shop operators much - the price for a cup of coffee is unlikely to increase for customers," said Mr Hong Poh Hin, chairman of the Foochow Coffee Restaurant and Bar Merchants Association, which represents 400 coffee shops.

Mr Kurt Wee, president of the Association of Small & Medium Enterprises, told The Straits Times the water price hike will impact manufacturers and industries that use a lot of water, and they may not be able to absorb the extra costs.

For local restaurant chain The Soup Spoon, whose menu items are 85 per cent water-based, the hike will be "steep", executive director and founder Anna Lim told TNP.

"Being one of the highest consumers of water in the F&B industry, we are re-looking our prices and working out the numbers to see how it is going to impact us," she said.

A spokesman for ABR Holdings, which runs chains such as Swensen's and Yogen Fruz, said water is a small component of its entire dish price, and it will not be planning to pass on any costs to consumers.

"We are more concerned about the cost of food ingredients as it is usually higher than water cost."

Dr Teo Ho Pin, coordinating chairman of the 15 town councils run by the People's Action Party said the hike will inevitably affect operating expenditure, reported The Straits Times.

He said: "Town councils will work closely with our partner agencies to explore more water saving measures."

Executive committee member of the Singapore Semiconductor Industry Association Lee Soon Kiat called for government support and incentives to encourage the industry to do more beyond its current implemented high average of 60 to 70 per cent water recycling.